A lot has been happening in the federal legislative arena so far this year. Early this year, Attorney General Jeff Sessions released a memo rescinding the previous administration’s guidance (the “Cole Memo”) related to the prosecution of federal marijuana laws. While none of the provisions were enshrined in law, the guidance found in multiple memos previously issued by the Department of Justice allowed states and cities the flexibility and confidence to develop and experiment with safe, federally-compliant marijuana industries. Sessions’s decision to scrap these existing rules significantly adds to the conflict between federal and state laws related to the manufacturing, distribution, and the sale of medical and recreational marijuana. Sessions’s directive makes it very difficult for marijuana businesses to open bank accounts, which further pushes the industry to rely on “cash only” models.

AWC members in Washington, D.C.

AWC’s Federal Committee updated the 2018 Federal Legislative Priorities, and then more than 70 Washington State city officials attended the National League of Cities (NLC) Congressional City Conference in Washington D.C. in March. The group met with Senators Patty Murray and Maria Cantwell, where they discussed city issues outlined in the priorities. Attendees and AWC leadership also met with their individual Congressional Representatives to discuss AWC priorities and their local city issues.

FY18 Omnibus spending bill

City leaders from across the nation lobbied Congress throughout the past year to save Community Development Block Grants (CDBG), Transportation Investment Generating Economic Recovery (TIGER) grants, workforce development and education programs, and energy efficiency and renewable energy programs. The House and Senate reached a deal on the omnibus appropriations bill (H.R. 1625), a $1.3 trillion spending proposal that maintains or increases funding for key programs that cities use to fund infrastructure, economic development and public safety, among others.

The bill also included additional funding for water infrastructure through the U.S. Environmental Protection Agency (EPA), including for lead testing and lead reduction in schools. Cities nationwide, through NLC also supported the bill’s reauthorization of the brownfields redevelopment program, which helps cities clean up contaminated properties, the expansion of Low-Income Housing Tax Credits to make up for losses in affordable housing stemming from tax reform, and the extension of the National Flood Insurance Program until July 31, 2018.

Selected provisions from the bill include:

• CDBG: First meaningful increase since 2010, from $3 billion to $3.3 billion
• TIGER: Increased by $1 billion
• Airport Discretionary Grants Targeting Small and Rural Airports: Increased by $1 billion
• Clean Water and Drinking Water State Revolving Loan Funds: Increased by $300 million each
• Transit Infrastructure Grants: Increased by $834 million (including $400 million to help communities modernize their bus systems and $400 million for capital assistance to transit systems)
• Rural Broadband Infrastructure: $600 million in new funds
• State and Local Law Enforcement Grants: Increased by $1.2 billion for a total of $2.9 billion in 2018 – This includes a total of $446.5 million (an increase of $299.5 million more than fiscal year 2017) in DOJ grant funding to help state and local communities respond to the opioid crisis
• State Opioid Response Grants: $1 billion in new funding for grants to states to address the opioid crisis (this funding is in addition to the $500 million provided in the 21st Century Cures Act)
• National Pre-disaster Mitigation Fund: Pre-disaster mitigation funding increased from $149 million to $249 million to build infrastructure that prevents loss of life and mitigates risks, reduces damage from future disasters, and lowers flood insurance premiums
• HUD-VA Supportive Housing (HUD-VASH) Vouchers: Increase funding of $40 million for new vouchers, while also protecting VA resources providing case management for homeless veterans

Federal court cases to watch

The U.S. Supreme Court will hear two cases this month of particular interest to Washington State. South Dakota v. Wayfair (Case No. 17-494) involves a challenge to South Dakota’s law requiring out-of-state retailers to collect sales tax, and will be direct challenge to the 1992 Quill decision, which requires that sellers have a physical presence before a state can require them to collect tax. The next day, the court will hear oral arguments in United States v. Washington (Case No. 17-269) where the state is asking the Court to review the Ninth Circuit’s decision regarding culverts and treaty rights involving fish passage. Beyond the potential costs of replacing culverts and depending on the scope of the decision, the case could have broad implications for both state and local infrastructure. Both decisions are expected to be issued by the end of June.

AWC’s next steps

AWC will:

• Continue monitoring the actions of federal authorities in light of the recent Cole Memo rescission;
• Monitor the U.S. Supreme Court cases mentioned above and report the outcomes and how they affect cities; and
• Work with NLC on emerging federal issues.